RELEASED
6th Jul 2006, 21:08
Fewer than 20 sackings: Qantas
Moving its wide-body maintenance is not costing jobs, says Steve Creedy July 07, 2006
QANTAS expects fewer than 20 forced redundancies as a result of its controversial decision to move wide-body heavy maintenance operations out of Sydney.
Heavy maintenance on Boeing 747s is now being handled at Avalon, Victoria, and 767 work has moved to Brisbane after the airline's decision earlier this year to keep the work onshore.
The airline said at the time that 420 jobs would be lost in Sydney and about 340 jobs would go across the airline.
Officials said this week that almost 20 Sydney workers had transferred to Avalon, which was now taking on new employees again, and about 30 had gone to Brisbane.
Qantas head of maintenance and engineering David Cox said a higher than predicted number of redeployments combined with voluntary departures meant no one had yet been sacked.
"There have been about 160 redeployments so far and we now have less than 20 to 30 compulsory redundancies and reducing," he said.
"If we can get away with zero, that will be a sensational job.
"But if you think about it, we had 980 people in scope, 420 jobs in the Sydney region and 340 net jobs.
"(We've worked) through all of that and so far we've had no compulsory redundancies and and if we do, it will be less than 20."
Qantas is now talking to unions about changes it will need to ensure the work remains in Australia.
It is also reviewing narrow-body heavy maintenance operations at Melbourne Airport and expects to make a decision within three months on whether that work will be sent offshore.
"We've begun the process," Mr Cox said.
"We would still expect to have a result by September thereabouts, which is what we announced back in March, and we'll do exactly what we did with the wide-body program: we'll do a very detailed analysis."
Qantas rejects union claims it wants to reduce labour rates to overseas levels and says the key to its success will be greater flexibility from its workforce.
This includes the ability to "bank" overtime so it can be used when needed - a sore point with unions - as well as more efficient work practices.
Mr Cox said the airline was committed to "having a go".
"The resources are being put behind this and both Geoff (Dixon) and I have gone out and made public comments that we're going to have a go at it," he said.
"We're not doing that lightly. We're doing that because we mean to succeed and it will be a genuine attempt to build an efficient and sustainable business in Australia.
"Some measure of that is that we have invested more than $300 million in Qantas engineering in the last few years and there's more being spent right now."
Mr Cox said Qantas had been "put through the wringer" over its claims of a 20 per cent gap between the productivity of its maintenance operations and those of the big maintenance repair and overhaul (MRO) companies, but the figure had stood up. He did not believe anybody now disputed that there was a gap to close. "But obviously that doesn't happen overnight. It's a one to two year journey," he said.
Mr Cox said the Qantas decision to do most of its own maintenance was at odds with industry trends, and he could not think of a single long-haul competitor that did not have a substantial part or all of its maintenance done in a low labour cost environment.
These included Singapore Airlines, Emirates (which flew in workers from the sub-continent), Lufthansa and United.
"So we're going a bit against the run of play here and that's why we need to keep talking about the need to transform and why it could never be anything other than a continuous journey of improvement, always with one eye on the market," he said.
Qantas estimates it is the 12th-biggest MRO is the world, employing 6000 people in facilities around the country.
It is running four wide-body heavy maintenance lines as well as two conversion lines in Avalon and Brisbane. This includes Australia's first freighter conversion project, in which four 737-300 passenger aircraft are being modified for the airline's freight joint-venture with Australia Post, known as Australian Air Express.
It employs 850 people in Avalon, all but 60 of them contractors employed by Forstaff Aviation, and 450 in Brisbane.
Wide-body heavy maintenance officially moved from Sydney on June 1 and the first 747 to have a "D-check" under the new system is expected to return to service next week.
While the airline hopes to do most of its 180-200 annual wide-body maintenance checks in Australia, officials say it is inefficient to do all of them here, and it will still send an average 10 to 20 aircraft overseas.
This includes work on A330s, which is always done offshore but which Qantas eventually hopes to bring back to Australia.
Mr Cox said expanding operations to a fifth wide-body heavy maintenance line capable of handling every Qantas aircraft would mean capacity would outstrip demand and the productivity gap with overseas operators would expand. There was no way it could keep the rest of the work onshore if it did that, he said.
"When you see us from time to time with a check offshore, it doesn't mean that we've changed our strategy," he said. "Quite the opposite. It's the strategy working. And the strategy is to ensure that the four lines in Australia are as competitive as they can be so the works stays here."
The Qantas maintenance chief said the extra work would go to "the assorted normal places", including Singapore, Hong Kong and New Zealand.
The airline was also looking at adding a specialist A330 Lufthansa Technik site in the Philippines and would make a decision in the next three or four months.
It was now in the planning stages for maintenance of its Boeing 787 fleet and was also talking to providers capable of doing the heavy maintenance on its A380s.
Moving its wide-body maintenance is not costing jobs, says Steve Creedy July 07, 2006
QANTAS expects fewer than 20 forced redundancies as a result of its controversial decision to move wide-body heavy maintenance operations out of Sydney.
Heavy maintenance on Boeing 747s is now being handled at Avalon, Victoria, and 767 work has moved to Brisbane after the airline's decision earlier this year to keep the work onshore.
The airline said at the time that 420 jobs would be lost in Sydney and about 340 jobs would go across the airline.
Officials said this week that almost 20 Sydney workers had transferred to Avalon, which was now taking on new employees again, and about 30 had gone to Brisbane.
Qantas head of maintenance and engineering David Cox said a higher than predicted number of redeployments combined with voluntary departures meant no one had yet been sacked.
"There have been about 160 redeployments so far and we now have less than 20 to 30 compulsory redundancies and reducing," he said.
"If we can get away with zero, that will be a sensational job.
"But if you think about it, we had 980 people in scope, 420 jobs in the Sydney region and 340 net jobs.
"(We've worked) through all of that and so far we've had no compulsory redundancies and and if we do, it will be less than 20."
Qantas is now talking to unions about changes it will need to ensure the work remains in Australia.
It is also reviewing narrow-body heavy maintenance operations at Melbourne Airport and expects to make a decision within three months on whether that work will be sent offshore.
"We've begun the process," Mr Cox said.
"We would still expect to have a result by September thereabouts, which is what we announced back in March, and we'll do exactly what we did with the wide-body program: we'll do a very detailed analysis."
Qantas rejects union claims it wants to reduce labour rates to overseas levels and says the key to its success will be greater flexibility from its workforce.
This includes the ability to "bank" overtime so it can be used when needed - a sore point with unions - as well as more efficient work practices.
Mr Cox said the airline was committed to "having a go".
"The resources are being put behind this and both Geoff (Dixon) and I have gone out and made public comments that we're going to have a go at it," he said.
"We're not doing that lightly. We're doing that because we mean to succeed and it will be a genuine attempt to build an efficient and sustainable business in Australia.
"Some measure of that is that we have invested more than $300 million in Qantas engineering in the last few years and there's more being spent right now."
Mr Cox said Qantas had been "put through the wringer" over its claims of a 20 per cent gap between the productivity of its maintenance operations and those of the big maintenance repair and overhaul (MRO) companies, but the figure had stood up. He did not believe anybody now disputed that there was a gap to close. "But obviously that doesn't happen overnight. It's a one to two year journey," he said.
Mr Cox said the Qantas decision to do most of its own maintenance was at odds with industry trends, and he could not think of a single long-haul competitor that did not have a substantial part or all of its maintenance done in a low labour cost environment.
These included Singapore Airlines, Emirates (which flew in workers from the sub-continent), Lufthansa and United.
"So we're going a bit against the run of play here and that's why we need to keep talking about the need to transform and why it could never be anything other than a continuous journey of improvement, always with one eye on the market," he said.
Qantas estimates it is the 12th-biggest MRO is the world, employing 6000 people in facilities around the country.
It is running four wide-body heavy maintenance lines as well as two conversion lines in Avalon and Brisbane. This includes Australia's first freighter conversion project, in which four 737-300 passenger aircraft are being modified for the airline's freight joint-venture with Australia Post, known as Australian Air Express.
It employs 850 people in Avalon, all but 60 of them contractors employed by Forstaff Aviation, and 450 in Brisbane.
Wide-body heavy maintenance officially moved from Sydney on June 1 and the first 747 to have a "D-check" under the new system is expected to return to service next week.
While the airline hopes to do most of its 180-200 annual wide-body maintenance checks in Australia, officials say it is inefficient to do all of them here, and it will still send an average 10 to 20 aircraft overseas.
This includes work on A330s, which is always done offshore but which Qantas eventually hopes to bring back to Australia.
Mr Cox said expanding operations to a fifth wide-body heavy maintenance line capable of handling every Qantas aircraft would mean capacity would outstrip demand and the productivity gap with overseas operators would expand. There was no way it could keep the rest of the work onshore if it did that, he said.
"When you see us from time to time with a check offshore, it doesn't mean that we've changed our strategy," he said. "Quite the opposite. It's the strategy working. And the strategy is to ensure that the four lines in Australia are as competitive as they can be so the works stays here."
The Qantas maintenance chief said the extra work would go to "the assorted normal places", including Singapore, Hong Kong and New Zealand.
The airline was also looking at adding a specialist A330 Lufthansa Technik site in the Philippines and would make a decision in the next three or four months.
It was now in the planning stages for maintenance of its Boeing 787 fleet and was also talking to providers capable of doing the heavy maintenance on its A380s.